Oracle Universal Power Unit Licensing

posted July 19, 2016, 11:23 AM by

by Jeff Stonacek, Principal Architect

House of Brick Technologies routinely deals with our customers’ opportunities regarding Oracle licensing. Occasionally, a little known licensing metric called Universal Power Units (UPU) rears its ugly head. The reason there is little known about this topic is that Oracle stopped offering new purchases of UPU licenses back in 2001. It was during this time that Oracle switched to Processor and Named User Plus licenses, primarily. However, there are some companies still running on an Oracle contract containing Universal Power Units, and if you are one of them, there’s a good chance you’re suffering from either or both of these afflictions:

  1. You are almost certainly out of compliance
  2. You are likely paying too much for annual support

 

The Universal Power Unit

In the late ’90s Oracle thought it would be a good idea to charge customers based on the power of the processor. I suppose this was a valid hypothesis, but one thing became obvious very quickly. Moore’s law could quickly make this type of licensing financially unattractive to the licensees. At the rate in which compute performance increases, the cost of a UPU license doubles about every two years. The industry quickly caught on to this and called Oracle out, which is why the UPU licensing model was very short lived.

UPU Calculation
This Oracle contract at sec.gov documents how UPUs are calculatedWhile we provide an excerpt below, see page three of the following link for the full details.

https://www.sec.gov/Archives/edgar/data/1108507/000095015202003059/j9249403ex10-38.txt

“UNIVERSAL POWER UNIT (“UPU”): is defined as one unit of platform dependent processing power. To determine the number of UPUs required for each Intel/CISC or Intel/CISC compatible processor, multiply the total number of MHz on which the programs are installed by a factor of 1.0. To determine the number of UPUs required for each RISC or RISC compatible processor (including Intel/RISC), multiply the total number of MHz on which the programs are installed by a factor of 1.5. To determine the number of UPUs required in a mainframe environment, multiply the total number of MIPS on which the programs are installed by a factor of 24. The total number of UPUs is determined by adding together the number of UPUs for all computers. Programs licensed on a UPU basis may be accessed by your internal users and by third party users via internet networking protocols.”

Simply stated, the following formulas will calculate the UPUs of your current hardware:

RISC – (# of cores * processor speed in MHz) * 1.5

Intel/AMD – (# of cores * processor speed in MHz) * 1

If you are running on recent RISC hardware (IBM pSeries, HP PA RISC, HP Itanium, Oracle SPARC, etc.) then the formula will produce a significantly higher license cost compared to a 2001 or earlier vintage server.

UPU Conversion
License metric upgrades allow the license purchase value of a quantity of license entitlement in one metric to be toggled to the same purchase value in another metric. The end state is license entitlement that the licensee can leverage in a more advantageous manner. This is common when a customer want to convert from a Named User Plus to a Processor based license, for example. The licensee must request a draft amendment from Oracle Corporation for the metric conversion.

The conversion ratio for UPU to Processor licenses is 1000:1. Meaning, one thousand UPUs are converted to one Processor license. If you need additional information on this reach out to us.

One issue with performing a license metric upgrade on UPU licenses is that UPU licenses typically carry a very high annual support cost compared to modern Processor based licenses. Annual support costs can be up to six times higher for UPU licenses when compared to Processor based licenses. With that in mind, it may be more cost effective to purchase new licenses in the favorable metric and deprecate the license entitlement in the old metric.

Next Steps

If you find yourself faced with a UPU licensing quandary, the following actions are prudent.

  • Review Licenses – Review all of your Oracle licenses to assess the current state of the environment.
  • Optimize Hardware – Optimizing licensing goes hand in hand with optimizing compute hardware. It is optimal to jointly review license along with compute hardware.
  • Migrate to Optimized Hardware – If necessary, migrate application servers and databases onto optimized hardware. This will provide the most cost effective options for fixing any compliance gaps.
  • Shop Around – If it is necessary to purchase new license when replacing UPU line items, so be sure to shop around. There are many Oracle partners out there who are willing to help negotiate the best deal, and discounts can vary greatly between resellers.

 

Conclusion

If you still have UPU line items on your contract, then it is advisable to review your license. You may be out of compliance or you may be paying too much for support. Either way, fixing the problem proactively is always better than doing it reactively.

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